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Andrew Smith writes "The UK taxman (HM Revenue & Customs) is reportedly using a stolen list of bank details to pursue wealthy individuals with off-shore accounts. The list was stolen by an employee of HSBC, and gave details of the bank's customers with money in Swiss accounts. The bank employee fled to France, and the authorities there passed the details on to the UK tax collection agency."

In the UK income tax, social security, etc are all taken at source (so is most of EU). In order for money to enter a tax evasion channel it has to come from outside normal payroll. If it is outside normal payroll (let's say investment) there is plenty of ways to tax-avoid which is not a crime. You can register a company which "owns" all of your income sources which are outside payroll (shares, etc) and tax deduce to the point where you pay very little or nothing.

In order for money to be tax evaded in the EU (not tax avoided) it has to be both outside payroll and too "dirty" to allow one to put it into a company or another accounting vehicle. That does not sound like "hard earned" money to me. In fact tracing the source of the money may prove a very interesting exsercise. That happened in the German case. Quite a few VP and board level people found on the Lichtenstein list ended up with fraud and corruption proceedings against them.

But as it is, in the UK, the United States, and elsewhere, banks create money, and decide who to loan it to. Governments have no other choice but to levy taxes on the economy.

Governments have "no other choice" than taxes? Governments control fiscal and monetary policy. They directly control how much banks can lend, and manage the effects of that lending. Some examples:

Governments can set reserve requirements - a minimum amount that banks must keep in their vaults. You can't loan out money that you're required to sit on; this reduces the money supply and increases interest rates.

Governments directly increase the money supply by printing currency. This lowers interest rates in the short run.

Governments can increase or decrease the money supply by buying or selling in the securities market, affecting interest rates appropriately.

Notice how none of the above involve taxation.

Whatever happened to that bill to 'Audit the Federal Reserve" (which is owned by private member banks)?

The Federal Reserve is not "owned" by member banks. Its board of governors is appointed by the President. Seven of them sit on the FOMC with five representatives of private banks. The bill to "audit" the Fed died because it was a bad idea.

Whatever you think about the Fed, at least its profits are returned to the U.S. Treasury now.

The Federal Reserve controls the amount of money in circulation by buying and selling government debt. By selling treasury bonds, the Fed takes money from their purchasers in exchange. The Fed sits on that money, effectively taking it out of circulation, and increasing interest rates.

The opposite action is buying government debt. Money the Fed was sitting on is now in circulation, increasing the money supply and lowering interest rates. The money swapped back and forth isn't "profit", and any in excess of what's needed to control interest rates has always been remitted to the treasury.

As for any calls to "reform" the financial system, I prefer my crackpots more in the vein of Dr. Ron Paul, as opposed to some guy with a Wordpress blog. YMMV.

10 times? The going rate for copyright infringement is a few thousand times the value of the information. The British government isn't some college student you know, they actually might have that kind of money.